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07 December 2018

IMSEE Publishes the 2017 GDP Results

DR

Today, the Monegasque Institute of Statistics and Economic Studies (IMSEE) published the Gross Domestic Product (GDP) results. For the year 2017, this amounted to EUR 5.68 billion compared to 5.85 billion in 2016. Monaco's GDP declined by -3.5% (in volume terms, adjusted for inflation - see Table 1), mainly due to two sectors, construction and other service activities, the same sectors that produced the growth in 2016.

In 2016, the growth was entirely due to the performance of the construction sector (real estate development) and other service activities sectors, which generated a significant Gross Operating Surplus.

In 2017, these results had a direct impact on the Principality's overall GDP.

As is often the case in the Principality, but particularly in 2016, the overall result was only the expression of exceptional individual results. The same is true for 2017.

Reservations on real estate developments in 2017 will only appear in the 2018 accounts, when the real estate is delivered. This leads to a difference in the indicators.

The results of other service activities confirm the volatility of this sector, which is subject to strong annual variations, depending on the results of the companies of which it is comprised. This sector experienced the largest decline (-22.4%) in 2015, the highest growth (+39.3%) in 2016 and the second largest decline (-21.1%) in 2017.

In this context, employment continued to grow in 2017, in both the private and public sectors. There were 1,853 additional employees (+3.5%) in the month of December. The payroll showed an increase (+4.1%); it represents more than half of GDP (50.8%).

Monegasque entrepreneurs seem to have favoured employment, to the detriment of their profit margins (see Table 3).

After four consecutive years of growth, the Gross Operating Surplus (GOS) of companies declined (-9.5% in value). It reached $2.57 billion and represented 40.9% of the wealth created. Since 2005, the GOS has only shrunk four times, notably in 2009, following the international financial crisis.

Taxes paid on products increased in value (+0.1%), but decreased in volume (adjusted for inflation -0.6%). They contribute 13.1% to the wealth produced. It is mainly transfer taxes and VAT on real estate that are falling, while other taxes are rising.

The amount of subsidies increased (+16.1%), mostly due to the creation of the Dependency Fund and the amounts allocated to energy transition.

The Principality's three largest economic sectors, in terms of GDP, are financial and insurance activities, scientific and technical activities, administrative and support services and real estate. These represent almost half (44.8%) of the wealth produced.

The "per capita" GDP amounted to EUR 67,786. It decreased by -6.7% in volume (see Table 4). GDP per employee, a indicator of productivity, also fell by -6.8% to EUR 104,603 (see Table 5).